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HomeMy WebLinkAbout#14 - 2023 Medical Insurance Plans STAFF REPORT DATE: November 1, 2022 CONSENT TO: Honorable Mayor and City Council AGENDA ITEM 2023 Medical Insurance Renewals SUBMITTED BY: Kristina Handt, City Administrator BACKGROUND: On October 12th staff met with NFP Representative Jolene Carlson to discuss renewal rates for health insurance coverage from Minnesota Public Employee Insurance Program (PEIP), dental options, life and disability coverage. A renewal meeting for all covered staff is scheduled for November 3rd. ISSUE BEFORE COMMITTEE: Should Council approve the insurance renewals as recommended? PROPOSAL: The 2023 renewal rate for health insurance coverage from Minnesota Public Employee Insurance Program (PEIP) increased by 4.9%, which is one of the lowest seen amongst NFP’s cities. PEIP is the health insurance offered to non-represented employees working at least 30 hours a week. It includes three different plan options and three different carriers to allow for maximum flexibility in meeting staff’s needs. The city’s current dental provider, Delta Dental, is proposing a 21.8% increase after years of no increases. Because of this big increase, NFP sought out other options. Health Partners’ Dental would offer a similar plan for those employees utilizing a Health Partners or Park Dental Clinic which would result is a small decrease of 0.9%. A summary of the Distinctions 2 plan is included in your packet. No price increases are proposed for life and short and long term disability. FISCAL IMPACT: The 4.9% increase in rates from PEIP results in an annual increase in cost to the City of $12,199. The preliminary 2023 budget included a 10% for all insurance plans. By switching to Health Partners Dental, the city budget for 2023 would be able to be decreased in all related categories before final adoption. OPTIONS: 1) Approve Resolution No. 2022-101 2) Amend and approve Resolution No. 2022-101 3) Make no approval. RECOMMENDATION: “Move to approve Resolution No.2022-101” ATTACHMENTS: 1) 2023 PEIP renewal letter 2) Health Partners Dental Distinctions 2 3) Resolution No. 2022-101 September 30, 2022 Kristina Handt City Of Lake Elmo 3800 Laverne Avenue No Lake Elmo, MN 55042 RE: January 2023 PEIP Renewal for City Of Lake Elmo Dear Kristina: Thank you for your participation in the Public Employees Insurance Program (PEIP) Pool. We hope the program continues to fulfill your insurance needs. The January 2023 renewals were calculated with revised underwriting guidelines. In the past PEIP was very successful in pooling claims from all groups and giving similar renewals to those groups based on the program’s total claims experience. This approach shielded groups from the sometimes-significant volatility of their rates from year to year. Over the last 12 years the renewal increases averaged 3.6% using that strategy. Unfortunately, we can no longer use that underwriting model. Over the last two years groups have left the program for expected short-term savings, rather than continuing to benefit from the long-term solution of a single pool. Most groups leaving had better than average claims experience, leaving higher risk groups remaining. The benefit of pooling all groups together is only realized with long-term commitment to the pool. While groups’ risks can change widely from year to year, the program is forced to change our methods to ensure stability of the pool. Starting with last year’s renewal, groups will be rated differently from the previous premium bands that were used. While there will be continued pooling/banding of groups, it will be determined more by each group’s own claims experience. As a result, some groups will see very significant changes in their January renewal rates. PEIP underwriters need to make any changes necessary to protect the financial stability of the pool. PEIP continues to offer unique features to all public employer groups. • An individual choice of three network providers for each employee, along with three plan design options. • Very low administrative costs by leveraging with the state of Minnesota employees’ contracts with each of the three network carriers. Plan Changes for 2023 The only plan change for 2023 is to increase the deductible on the HSA cost level 1 plan to $3,000 per family member/$3,200 per family. The change ensures the plan continues to meet the minimum deductible limits required by the IRS. January 2023 will be the start of year 2 of your two-year commitment in the PEIP program per the PEIP statute and group application (see the rule below). 43A.316 PUBLIC EMPLOYEES INSURANCE PROGRAM. (d) Participation in the program is for a two-year term. Participation is automatically renewed for an additional two-year term unless the exclusive representative, or the employer for unrepresented employees, gives the commissioner notice of withdrawal at least 30 days before expiration of the participation period. A group that withdraws must wait two years before rejoining. An exclusive representative, or employer for unrepresented employees, may also withdraw if premiums increase 50 percent or more from one insurance year to the next. Page 2 The PEIP 2023 clinic directory will be available on the PEIP website by mid-October. Please make sure members review their clinics for any cost level changes. During open enrollment, your insurance eligible employees will have the opportunity to change health plans and carrier networks. Reminder, there is not an open enrollment for dental coverage. Please have the open enrollment completed by November 18, 2022. Updated plan summaries and other enrollment information is included with the renewal. Forms can also be found on PEIP’s website at www.innovomn.com. For retirees over age 65, individual Medicare Advantage and Cost policies are available. Please call Innovo Benefits Administration at 1-800-829-5601 or contact your plan administrator for more details or visit our website at www.innovomn.com. Employees and dependents who wish to change health plans or networks must complete an Enrollment Form (or online enrollment) for the change. A primary care clinic number for each member is required. Participants staying with the same carrier who wish to change their primary care clinic must contact the carrier directly. Primary care clinics can be changed at any time by calling the customer service number on the member’s ID card. All completed enrollments and any changes to your group's eligibility requirements must be submitted to Innovo Benefits Administration, PEIP's administrator, by November 18, 2022. Please plan your open enrollment to meet that deadline. **** Please send enrollment/changes to Innovo for those employees making a plan, carrier or family changes only. No form is required for those employees maintaining current coverage. ***** As the sponsor of the group insurance, you may change or add additional PEIP product options (e.g. life and dental coverages) and change your eligibility requirements at this time. Eligibility criteria includes number of hours worked per week to be eligible, new employee waiting periods before coverage becomes effective, etc. Any changes made to your current eligibility policy must be made in writing and sent to Innovo. Participation is automatically renewed for an additional two-year term unless the exclusive representative, or the employer for unrepresented employees gives the commissioner notice of withdrawal at least 30 days before expiration of the participation period. A PowerPoint presentation that explains the plan choices and instructions on completing the employee enrollment will be sent in a separate email. Please submit all forms via fax, email or mail to: Innovo Benefits Administration Attn: PEIP 7805 Telegraph Road, Suite 110 Bloomington, MN 55438 Secure Fax: 952-746-3108 Email: service@innovomn.com Please forward the renewal rate information to your COBRA, Minnesota continuation, disabled, and early retiree participants (if any). If PEIP manages your COBRA, Innovo will send out the information to these participants. If you have any questions, please call 952-746-3101 or 1-800-829-5601 or email shawn@innovomn.com. We look forward to another year of serving you. Sincerely, Shawn Byrne Manager Cc: Agent, if applicable City Of Lake Elmo 1/1/2023 Renewal Rates Advantage Plans In accordance with MN Stat.471.61, renewal rates for retirees who are under age 65 are blended with the rates for active employees. Eligible retirees currently on continuation are included in the rate structure. 2022 vs 2023 MEDICAL RATES Current Rates Renewal Rates 2023 Advantage High Option Single Family $ 647.84 $1,687.70 $ 679.08 $1,770.94 Advantage Value Option Single Family $ 584.46 $1,518.48 $ 612.53 $1,593.25 Advantage HSA Option Single Family $ 459.60 $1,184.12 $ 481.43 $1,242.18 If you work with an agent, please confirm commission amount with them. Rates shown include commission, if Applicable. 2022 VS 2023 DENTAL RATES – PREVENTIVE PLAN (CLOSED TO NEW ENROLLMENT), if applicable Current Renewal Monthly Rate - Employer Pays 90% or More of Cost $11.72 $35.57 $12.45 $37.71 Monthly Rate - Employer Pays 50-89% Of Cost $12.76 $39.48 $13.54 $41.88 2022 VS 2023 DENTAL RATES – COMPREHENSIVE PLAN, if applicable Current Renewal Monthly Rate - Employer Pays 90% or More of Cost $40.16 $95.73 $42.60 $101.51 Monthly Rate - Employer Pays 50-89% Of Cost $44.43 $104.95 $47.14 $111.30 2023 LIFE RATES, if applicable Basic Life/AD&D $.18/1,000 Dependent Life $1.18 Supplemental Life (Per Thousand) Age <35 35-39 40-44 45-49 50-54 55-59 60-64 65-69 $.11 $.13 $.17 $.26 $.44 $.71 $.79 $1.49 DistinctionsSM Dental Plan Great care, savings and access in one plan Give your employees the best benefit choices. The Distinctions plan has a tiered network with two benefit levels and includes more than 2,900 PPO dentists throughout Minnesota and border communities, and 85% of Twin Cities metro-area dentists. Benefit Level 1 features two of Minnesota’s most respected dental groups — HealthPartners Dental Group and Park Dental Clinics. Benefit Level 2 includes our Open Access network of more than 120,000 PPO providers nationwide. Little PartnersSM dental benefit Kids 12 and under are covered 100% at in-network dentists, with no deductibles, no coinsurance and no annual maximum. HealthPartners MouthWise Matters Gum disease can lead to health problems for those living with diabetes or who are pregnant. These members get 100% coverage with no annual limits on medically necessary services, including exams, cleanings, scaling and root planing. Save 15% on orthodontics Save 15% at the top orthodontic clinics in Minnesota: HealthPartners Orthodontics, Three Rivers Orthodontics, Orthodontic Care Specialists, LTD., and The Dental Specialists Orthodontics. Save with Healthy DiscountsSM program Members will save at local and national retailers on things like hearing aids, glasses, groceries and exercise equipment. Plus, with Assist America® we’ll help you find care when you’re traveling. Save 25% When you pair a dental plan with a HealthPartners small group medical plan, you’ll save 25% on your dental family rate. Plus, you’ll get a two-year rate guarantee!* Plans are underwritten and/or administered by HealthPartners family of health plans which includes, HealthPartners, Inc., HealthPartners Insurance Company and HealthPartners Administrators, Inc. Fully insured Wisconsin plans are underwritten by HealthPartners Insurance Company. 19-633448-633565 (12/19) ©2019 HealthPartners Bundle and simplify Pair dental with small group medical to simplify your administrative functions, including enrollment, claims, member services, communications and more. Questions? Call 800-298-4235 * If a small medical group is reclassified as large under the ACA or switches medical carriers, the dental 25% savings is no longer valid. - - - - - - - Dental Distinctions 2 Plan City of Lake Elmo Effective January 2023 Metro area Participation Requirements: 75 percent of employees not enrolled in a group plan elsewhere and 50 percent of all employees. Contribution Requirement: minimum 50 percent of single premium contributed by employer. HealthPartners must be sole carrier. Annual open enrollment required; if coverage is waived, employee must have a qualifying event to receive coverage prior to the next open enrollment period. Employer must have a group medical plan. Rates are for new business with HealthPartners dental. Distinctions products are only available in the Twin Cities metro, St. Cloud and Rochester areas. BENEFIT LEVEL 1 BENEFIT LEVEL 2 OUT-OF-NETWORK Annual Maximum $2000 $1000 $750 Deductible Per person per calendar year $0 $25 $50 Family $0 $75 $150 Preventive/Diagnostic care Exams, cleanings, x-rays, flouride 100%100%100% Sealants, space maintainers 100%100%100% Basic I services Amalgam fillings 100%80%50% Posterior composite fillings 80%80%50% Simple extractions 80%80%50% Non-surgical periodontics 80%80%50% Endodontics 80%80%50% Basic II services Surgical periodontics 80%50%50% Other oral surgery 80%50%50% Major services Crowns, onlays 50%50%50% Bridges, dentures 50%50%50% Dental implants 50%50%50% Rates are effective for 24 months when paired with a HealthPartners medical plan Monthly premiums based on number of enrolled employees Employees enrolled 10-24 Single $38.16 Single + 1 $76.33 Family $114.48 Family discount is applied when paired with a HealthPartners Small Group Medical plan Family (with paired discount)$85.86 Underwriting Guidelines R2C1P12D0M0O1 CITY OF LAKE ELMO WASHINGTON COUNTY STATE OF MINNESOTA RESOLUTION NO. 2022-101 A RESOLUTION APPROVING HEALTH CARE PLAN AND ESTABLISHING CITY CONTRIBUTION TO EMPLOYEE HEALTH INSURANCE BENEFITS FOR 2023 WHEREAS, the Lake Elmo City Council has determined that it is the best interest of the City to provide a health insurance plan to help maintain the health of its current employees and to enable the city to attract and retain a quality workforce; and WHEREAS, it is now necessary to determine the insurance plan and contributions to premium costs for the period from 1/1/2023 to 12/31/2023; NOW, THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF THE CITY OF LAKE ELMO, WASHINGTON COUNTY, MINNESOTA, that it should and hereby does approve the PEIP Advantage Plan and Health Partners Dental Plan for the period of 1/1/23 to 12/31/23 for eligible, non-represented employees; and FURTHER BE IT RESOLVED, that for calendar year 2023, the City of Lake Elmo’s contribution to the total cost of providing health insurance benefits through PEIP shall be as follows: Advantage Plan: 90% of premium for single coverage and 80% of premium for family coverage. Value Option: 100% of premium for single coverage and 90% of premium for family coverage HSA Compatible: 100% of premium for single coverage and $100/month to HSA; 95% of premium for family coverage and $200/month to HSA. BE IT FURTHER RESOLVED, that for calendar year 2023, the City of Lake Elmo shall contribute 100% of the cost of Health Partners dental coverage for eligible, non-represented employees. This resolution was adopted by the City Council of the City of Lake Elmo on this 1st day of November, 2022. _____________________________ Charles Cadenhead, Mayor ATTEST: ___________________________ Julie Johnson, City Clerk